Six Levels of Contract Automation: Evolution to Digitalised Smart (and Legal) Contracts

8 Pages Posted: 16 Dec 2020

Date Written: December 14, 2020

Abstract

Automation is taking hold in different aspects of business across every industry and every sector. Consistent with this trend, the notion of embedding automation into legally binding contracts is also gaining momentum. COVID-19 is fuelling digital transformation and has highlighted frustrations with static contracts that sit disconnected from digital processes and systems.

As automated ‘smart contracts’ become more common, lawyers have been grappling with how to preserve the legal integrity of the contract whilst harnessing the benefits of automation and digital connectivity.

Automation of contract performance is a field lacking in standard definitions. This paper proposes a framework to assist discussion and development of legally enforceable automation of contract performance and explores high level features of contracts along the spectrum of contract automation by proposing an initial model for the levels of automation (and digitalisation). This model draws analogies with the SAE International J3016 “Levels of Automation” widely adopted for autonomous vehicles.

Keywords: Smart Legal Contracts, Smart Legal Contract, Smart Contract, SLC, Levels of Contract Automation, the Wilkinson model, contract digitalisation, contract automation, automation, distributed ledger technology, digital law, automated law, self-executing code, contract law, Blycha and Garside model,

JEL Classification: K12, P, O

Suggested Citation

Wilkinson, Susannah, Six Levels of Contract Automation: Evolution to Digitalised Smart (and Legal) Contracts (December 14, 2020). Available at SSRN: https://ssrn.com/abstract=3748266 or http://dx.doi.org/10.2139/ssrn.3748266

Susannah Wilkinson (Contact Author)

Herbert Smith Freehills ( email )

480 Queen Street
Brisbane, 4000
Australia

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